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2022 (8) TMI 942 - ITAT MUMBAIEstimation of income - bogus purchases - HELD THAT:- CIT (A) relying on the decision of Hon'ble Gujarat High Court in case of CIT vs. Smith P Seth [2013 (10) TMI 1028 - GUJARAT HIGH COURT] wherein, it has been held that once the sale is accepted, the purchases cannot be questioned and entire purchases cannot be added but only profit element embedded therein could be added. The learned CIT (A) therefore has computed the profit margin at the rate of 6.5% of the purchases. DR did not question the profit rate of 6.5%. We also find that the learned CIT (A) has taxed the element of profit therein. There cannot be any standard or fixed benchmark of such estimate disturbing sales, we disagree with that because some profit has already been offered by assessee by showing sales. Further, 6.5% of profit in Imitation Jewellery business also cannot be said either too low or unreasonable. In view of this, the order of the learned CIT (A) is upheld. Accordingly, Ground nos. 1 to 3, are dismissed.
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